Tata AIG Nirvana is a traditional pension plan in which you can choose the retirement age (between 50 & 65) at which you want to start receiving your regular monthly pension. At the retirement age set by you, 33% of your accumulated amount can be withdrawn as a lump sum. The remainder can be used by you to purchase an annuity which will start giving you monthly pension.
Suppose you are currently 35 years old and plan to retire at the age of 60 and want a cover of Rs. 5 lakhs. You would have to pay a premium of Rs. 17,150 + Service Tax every year for 25 years (retirement age of 60 minus current age of 35). At the age of 60 the total benefits accrued to you would be Rs. 16,14,169 (assuming a return of 10%). You may choose to withdraw 33% of this amount at the age of 60 or invest the entire amount in an annuity which will then give you regular monthly income.
Key Features of Tata AIG Nirvana Policy
§ Guaranteed addition of 10% of the Sum Assured
§ Terminal and Reversionary Bonus declared every year depending on Company’s performance
§ Option to choose the retirement age to decide the age to start the pension (between 50 and 65 years)
§ Provides Life insurance cover throughout the policy term
Benefits you get from Tata AIG Nirvana Plan
Death Benefit – In case of death of the policy holder, the nominee gets sum assured + Bonus Benefits. In case the policy has been active for more than 10 years, a guaranteed 10% of the Sum Assured would also be received. Bonus will also be paid each year depending on the Company’s overall performance.
Maturity Benefit – The policy holder will get the Sum Assured + 10% of Sum Assured + Reversionary Bonus + Terminal Bonus.
Income Tax Benefit - Life Insurance premiums paid up to Rs. 1,00,000 are allowed as a deduction from the taxable income each year under section 80C. The maturity amount you receive from this plan are exempt from tax under section 10(10D)
Eligibility conditions and other restrictions in Tata AIG Life Nirvana Plan
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Minimum
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Maximum
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Sum Assured (in Rs.)
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50,000
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No Limit
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Policy Term (in years)
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10
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10
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Choice of Retirement Age
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50
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65
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Premium Payment Term (in years)
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Depends on choice of retirement age
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Single premium
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NA
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NA
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Payment modes
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Monthly, Quarterly, Half yearly & Yearly
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Annual Premium
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5,000
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No Limit
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Sample illustration of returns at the end of policy term in Tata AIG Nirvana
Sum Assured = Rs. 5 lakhs
Age of Retirement = 60 years
Notice the clear benefits of starting early
Additional Features and Benefits of Tata AIG Nirvana
Riders – A host of riders can be purchased along with Tata AIG Nirvana Plan
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Type of Rider
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Available with Policy
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Accidental Death Benefit
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Yes
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Accidental Death & Dismemberment
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Yes
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Critical illness (or dread diseases) benefit
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Yes
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Term Rider
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Yes
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Traditional Pensions Plans from other insurance companies
Bajaj Allianz Swarna Vishranti
SBI Life Lifelong Pension Plus
HDFC Personal Pension Plan
LIC Jeevan Dhara
Other Retirement Plans from Tata AIG Life Insurance
Tata AIG Life Nirvana Plus
Tata AIG Life Assure Golden Years
Tata AIG Life Easy Retire
Bonus Rates for Tata AIG Nirvana
The bonus declared by Tata AIG Life Insurance Company for its Nirvana Pension plan is
2010-11 = 3.5%
2011-12 = 3.5%
